The molecular basis of alcohol action in the nervous system is poorly understood. Neurotransmitter receptors have been found to be alcohol sensitive membrane proteins. We are studying molecular determinants of alcohol sensitivity of some types of these proteins. A nicotinic-serotonergic chimera indicated that the N-terminal domain is involved in the action of ethanol on this protein (Mol Pharmacol 1996;50:1010). We found that site directed mutagenesis of single amino acids in the N-terminal domain of the 5-HT3 receptor alters the apparent agonist affinity and the ethanol sensitivity of this protein. The wild-type (WT) and mutant receptors were expressed in Xenopus oocytes and their function studied using two-electrode voltage-clamp. The arginine at amino acid 245 was substituted with alanine, threonine, glutamic acid and lysine. The order of the EC50 values of the 5-HT concentration-response curves was R245A < R245E < R245T < WT < R245K. The order of percentage potentiation by 100 mM ethanol was R245A > R245E > R245T > WT > R245K. The percentage potentiation by ethanol inversely correlated with the EC50 values of 5-HT3 receptor-mediated currents. The observations suggest that mutation of the arginine at amino acid 245 of the 5-HT3 receptor may modulate the ethanol sensitivity of the receptor by altering the apparent agonist affinity of the receptor. The effect of mutation on ethanol sensitivity and receptor function is also being studied for other amino acids in the 5-HT3 receptor and in other ligand-gated membrane ion channels.